EXHIBIT 99.2
AZTEC MANUFACTURING CO.
AND
XXXXXX TRUST AND SAVINGS BANK
RIGHTS AGENT
RIGHTS AGREEMENT
DATED AS OF JANUARY 7, 1999
TABLE OF CONTENTS
SECTION PAGE
Section 1. Certain Definitions.......................................... 1
Section 2. Appointment of Rights Agent.................................. 6
Section 3. Issuance of Rights Certificates.............................. 6
(a) Distribution Date; Rights Certificates....................... 6
(b) Common Stock Certificates; Summary of Rights................. 7
(c) Legend....................................................... 7
Section 4. Form of Rights Certificates.................................. 8
(a) Form; Date................................................... 8
(b) Acquiring Person Legend...................................... 8
Section 5. Countersignature and Registration............................ 9
(a) Signatures................................................... 9
(b) Registration and Transfer.................................... 9
Section 6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost or
Stolen Rights Certificates................................... 9
(a) Procedure.................................................... 9
(b) Issuance of New Rights Certificates.......................... 10
Section 7. Exercise of Rights; Purchase Price; Expiration Date
of Rights.................................................... 10
(a) Exercise..................................................... 10
(b) Purchase Price............................................... 11
(c) Rights Agent Actions......................................... 11
(d) Partial Exercise............................................. 11
(e) Termination of Acquiring Person's Rights..................... 11
(f) Surrender of Rights Certificates; Identity of
Beneficial Owner............................................. 12
Section 8. Cancellation and Disposition of Rights Certificates.......... 12
Section 9. Reservation and Availability of Capital Stock................ 12
(a) Reservation of Capital Stock................................. 12
(b) Listing...................................................... 12
(c) Registration under the Act................................... 12
(d) Covenant Regarding Capital Stock............................. 13
(e) Transfer Taxes and Charges................................... 13
i
Section 10. Common Stock Record Date..................................... 13
Section 11. Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights................................... 14
(a) Certain Adjustments.......................................... 14
(b) Purchase Price Adjustment -- Capital Stock................... 17
(c) Purchase Price Adjustment -- Cash, Assets, etc............... 18
(d) Current Market Price......................................... 18
(e) Purchase Price Adjustment Threshold.......................... 19
(f) Equivalent Adjustments....................................... 19
(g) Post-Adjustment Rights Issuances............................. 19
(h) Common Stock Anti-Dilution................................... 20
(i) Adjustment of Number of Rights............................... 20
(j) Rights Certificates.......................................... 20
(k) Adjustment Below Par Value................................... 21
(l) Adjustment Effective as of Future Date; Exercise............. 21
(m) Tax Adjustments.............................................. 21
(n) Restriction on Certain Transactions.......................... 21
(o) Restriction Against Diminishing Benefits of the.............. 22
Rights
(p) Common Stock Adjustments..................................... 22
Section 12. Certificate of Adjusted Purchase Price or Number of Shares... 22
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power...................................... 22
(a) Flip-over Event.............................................. 22
(b) Principal Party.............................................. 24
(c) Supplemental Agreement....................................... 24
(d) Exceptions................................................... 25
Section 14. Fractional Rights and Fractional Shares...................... 25
(a) Fractional Rights............................................ 25
(b) Fractional Shares of Common Stock............................ 26
(c) Waiver of Fractional Rights and Shares....................... 26
Section 15. Rights of Action............................................. 26
Section 16. Agreement of Rights Holders.................................. 26
Section 17. Rights Certificate Holder Not Deemed a Shareholder........... 27
Section 18. Concerning the Rights Agent.................................. 27
(a) Compensation................................................. 27
(b) Reliance..................................................... 28
ii
Section 19. Merger or Consolidation or Change of Name of Rights Agent.... 28
(a) Successor.................................................... 28
(b) Prior Countersignatures...................................... 28
Section 20. Duties of Rights Agent....................................... 28
(a) Legal Counsel................................................ 28
(b) Certification by the Company................................. 29
(c) Liability for Negligence, etc................................ 29
(d) Statements of Fact or Recitals............................... 29
(e) Agreement; Adjustments....................................... 29
(f) Further Assurances........................................... 29
(g) Instructions................................................. 29
(h) Dealing in Rights............................................ 30
(i) Agents; Reasonable Care...................................... 30
(j) Expenses; Repayment Assurances............................... 30
(k) Exercise of Rights; Consultation with Company................ 30
(l) No Constructive Notice....................................... 30
Section 21. Change of Rights Agent....................................... 31
Section 22. Issuance of New Rights Certificates.......................... 31
Section 23. Redemption and Termination................................... 32
(a) Redemption................................................... 32
(b) Effect of Redemption; Procedure.............................. 32
Section 24. Exchange..................................................... 33
(a) Right to Exchange............................................ 33
(b) Effect of Exchange; Procedure................................ 33
(c) Common Stock Equivalents..................................... 33
(d) Insufficient Common Stock.................................... 34
(e) Fractional Shares............................................ 34
Section 25. Notice of Certain Events..................................... 34
(a) Common Stock Transactions, etc............................... 34
(b) Other Transactions........................................... 35
Section 26. Notices...................................................... 35
Section 27. Supplements and Amendments................................... 35
Section 28. Successors................................................... 36
Section 29. Determinations and Actions by the Board of Directors, etc.... 36
iii
Section 30. Benefits of this Agreement................................... 37
Section 31. Severability................................................. 37
Section 32. Governing Law Section........................................ 37
Section 33. Counterparts................................................. 37
Section 34. Descriptive Headings......................................... 37
Exhibit 1 Form of Rights Certificate................................... 39
iv
RIGHTS AGREEMENT
This RIGHTS AGREEMENT, is dated as of January 7, 1999 (the "Effective
Date"), between Aztec Manufacturing Co., a Texas corporation (the "Company"),
and Xxxxxx Trust and Savings Bank, an Illinois banking corporation (the "Rights
Agent").
RECITALS
--------
On January 7, 1999 (the "Rights Dividend Declaration Date"), the Board of
Directors of the Company authorized and declared a dividend distribution of one
right (a "Right") for each share of Common Stock (as hereinafter defined) of the
Company outstanding at the close of business on February 4, 1999 (the "Record
Date"), and has authorized the issuance of one Right (as such number may
hereafter be adjusted pursuant to the provisions of Section 11(p) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Common Stock
Adjustments)) for each share of Common Stock of the Company issued between the
Record Date (whether originally issued or delivered from the Company's treasury)
and the Distribution Date, each Right initially representing the right to
purchase one share of Common Stock, upon the terms and subject to the conditions
set forth herein (the "Rights Agreement").
AGREEMENT
---------
In consideration of the premises and the mutual agreements herein set
forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial Owner
(as such term is hereinafter defined) of 15% or more of the shares of Common
Stock then outstanding, but shall not include (i) the Company, (ii) any
Subsidiary of the Company, (iii) any employee benefit plan of the Company or of
any Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan or (iv)
any Person who becomes an Acquiring Person solely as a result of a reduction in
the number of shares of Common Stock outstanding due to the repurchase of shares
of Common Stock by the Company, unless and until such Person shall purchase or
otherwise become (as a result of actions taken by such Person or its Affiliates
or Associates) the Beneficial Owner of additional shares of Common Stock
constituting 1% or more of the then outstanding shares of Common Stock;
provided, however, that if a Person shall become the Beneficial Owner of 15% or
more of the Common Stock of the Company then outstanding by reason of share
repurchases by the Company and shall, after such share repurchases by the
Company, become the Beneficial Owner of any additional Common Stock of the
Company, then such Person shall be deemed to be an "Acquiring Person," unless
upon the consummation of the acquisition of such additional shares of Common
Stock such Person does not beneficially own 15% or more of the shares of Common
Stock then outstanding. Notwithstanding the foregoing, if the Board of Directors
of the Company determines in good faith that a Person who would otherwise be an
Acquiring Person, as defined pursuant to the foregoing provisions of this
1
paragraph, has become such inadvertently (including, without limitation, because
(i) such Person was unaware that it beneficially owned a percentage of Common
Stock that would otherwise cause such Person to be an Acquiring Person, or (ii)
such Person was aware of the extent of its Beneficial Ownership of Common Stock
but had no actual knowledge of the consequences of such Beneficial Ownership
under this Agreement) and without any intention of changing or influencing
control of the Company, and such Person divests as promptly as practicable a
sufficient number of shares of Common Stock so that such Person would no longer
be an Acquiring Person as defined pursuant to the foregoing provisions of this
paragraph, then such Person shall not be deemed to be or to have become an
Acquiring Person for any purposes of this Agreement.
(b) "Act" shall mean the Securities Act of 1933, as amended and in
effect from time to time.
(c) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments)
(d) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act.
(e) "Agreement" shall mean this Rights Agreement as originally
executed or as it may from time to time be supplemented or amended pursuant to
the applicable provisions hereof.
(f) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (whether or not in writing) or upon the
exercise of conversion rights, exchange rights, rights, warrants or options, or
otherwise; provided, however, that a Person shall not, for purposes of this
paragraph (i), be deemed the "Beneficial Owner" of or to "beneficially own," (A)
securities tendered pursuant to a tender or exchange offer made by such Person
or any of such Person's Affiliates or Associates until such tendered securities
are accepted for purchase or exchange, or (B) securities issuable upon exercise
of Rights at any time prior to the occurrence of a Triggering Event, or (C)
securities issuable upon exercise of Rights from and after the occurrence of a
Triggering Event, which Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or pursuant to
Section 3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates) or Section 22 (Issuance of New Rights Certificates) (the "Original
Rights") or pursuant to Section 11(i) (Adjustment of Purchase Price; Number and
Kind of Shares or Number of Rights -- Adjustment of Number of Rights) in
connection with an adjustment made with respect to any Original Rights;
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of or has
"beneficial ownership" of (as determined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding, whether or not in writing; provided,
however, that a Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially
2
own," any security under this subparagraph (ii) as a result of an agreement,
arrangement or understanding to vote such security if such agreement,
arrangement or understanding: (A) arises solely from a revocable proxy given in
response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules and Regulations
under the Exchange Act, and (B) is not also then reportable by such Person on a
Schedule 13D under the Exchange Act (or any comparable or successor report); or
(iii) which are "beneficially owned," directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which such Person
(or any of such Person's Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in writing), for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy as described in
the proviso to subparagraph (ii) of this paragraph (f)) or disposing of any
voting securities of the Company;
provided, however, that nothing in this paragraph (f) shall cause a Person
engaged in business as an underwriter of securities to be the "Beneficial Owner"
of or to "beneficially own," any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of forty (40) calendar days after the date of such acquisition.
(g) "Board" means the Board of Directors of the Company.
(h) "Business Day" shall mean any day other than a Saturday, Sunday
or a day on which banking institutions in the State of Texas, Illinois or New
York are authorized or obligated by law or executive order to close.
(i) "Close of Business" on any given date shall mean 5:00 P.M., New
York time, on such date; provided, however, that if such date is not a Business
Day it shall mean 5:00 P.M., New York time, on the next succeeding Business Day.
(j) "Common Stock" shall mean the common stock, $1.00 par value per
share, of the Company, except that "Common Stock" when used with reference to
any Person other than the Company shall mean the capital stock of such Person
with the greatest voting power, or the equity securities or other equity
interest having power to control or direct the management, of such Person.
(k) "Common Stock Equivalents" shall have the meaning set forth in
Section 11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments).
(l) "Company" shall mean the Person named as the "Company" in the
first paragraph of this Agreement until a successor corporation shall have
become such, or until a Principal Party shall assume, and thereafter be liable
for, all obligations and duties of the Company hereunder, pursuant to the
applicable provisions of this Agreement, and thereafter "Company" shall mean
such successor corporation or Principal Party.
(m) "Current Market Price" shall have the meaning set forth in
Section 11(d) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights -- Current Market Price).
3
(n) "Current Value" shall have the meaning set forth in Section
11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights --Certain Adjustments).
(o) "Disinterested Director" shall mean (i) any member of the Board,
while such Person is a member of the Board, who is not an Acquiring Person, or
an Affiliate or Associate of an Acquiring Person, or a representative or nominee
of an Acquiring Person or of any such Affiliate or Associate, and was a member
of the Board prior to the date of this Agreement, or (ii) any Person who
subsequently becomes a member of the Board, while such Person is a member of the
Board, who is not an Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or a representative or nominee of an Acquiring Person or of
any such Affiliate or Associate, if such Person's nomination for election or
election to the Board is recommended or approved by a majority of the
Disinterested Directors.
(p) "Distribution Date" shall have the meaning set forth in Section
3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates).
(q) "Effective Date" shall have the meaning set forth in the first
paragraph of this Agreement.
(r) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended and in effect on the date of this Agreement.
(s) "Exchange Number" shall mean one-half of the number of shares of
Common Stock or shares or other units of other property for which a Right is
exercisable immediately prior to the time of the action of the Board to exchange
the Rights.
(t) "Expiration Date" shall have the meaning set forth in Section
7(a) (Exercise of Rights; Purchase Price; Expiration Date of Rights --Exercise).
(u) "Final Expiration Date" shall mean the Close of Business on
January 7, 2009.
(v) "Flip-in Event" shall mean any event described in Section
11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights --Certain Adjustments).
(w) "Flip-in Trigger Date" shall have the meaning set forth in
Section 11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments).
(x) "Flip-over Event" shall mean any event described in clauses (x),
(y) or (z) of Section 13(a) (Consolidation, Merger or Sale or Transfer of Assets
or Earning Power -- Flip-over Event).
(y) "Original Rights" shall have the meaning set forth in Section
1(f)(i) (Certain Definitions).
4
(z) "Person" shall mean any individual, firm, corporation,
partnership or other entity.
(aa) "Principal Party" shall have the meaning set forth in Section
13(b) (Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Principal Party).
(bb) "Purchase Price" shall have the meaning set forth in Section 4(a)
(Form of Rights Certificates -- Form; Date).
(cc) "Qualified Offer" shall have the meaning set forth in Section
11(a)(ii)(A).
(dd) "Record Date" shall have the meaning set forth in the Recitals at
the beginning of the Agreement.
(ee) "Redemption Date" shall have the meaning set forth in Section
23(a) (Redemption and Termination -- Redemption).-
(ff) "Redemption Price" shall have the meaning set forth in Section
23(a) (Redemption and Termination -- Redemption).
(ff) "Rights" shall have the meaning set forth in the Recitals at the
beginning of the Agreement.
(hh) "Rights Agent" shall mean the Person named as the "Rights Agent"
in the first paragraph of this Agreement until a successor Rights Agent shall
have become such pursuant to the applicable provisions hereof and thereafter
"Rights Agent" shall mean such successor Rights Agent. If at any time there is
more than one Person appointed by the Company as Rights Agent pursuant to the
applicable provisions of this Agreement, "Rights Agent" shall mean and include
each such Person.
(ii) "Rights Certificates" shall have the meaning set forth in Section
3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates).
(jj) "Rights Dividend Declaration Date" shall have the meaning set
forth in the Recitals at the beginning of the Agreement.
(kk) "Spread" shall have the meaning set forth in Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments).
(ll) "Stock Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed or amended pursuant to Section 13(d) under the
Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has
become such other than pursuant to a Qualified Offer.
(mm) "Subsidiary" shall mean, with reference to any Person, any
corporation or other entity of which an amount of voting securities sufficient
to elect at least a majority of the directors of such corporation or entity is
beneficially owned, directly or indirectly, by such Person, or otherwise
controlled by such Person.
5
(nn) "Substitution Period" shall have the meaning set forth in Section
11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments).
(oo) "Trading Day" shall have the meaning set forth in Section
11(d)(i) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights --Current Market Price).
(pp) "Triggering Event" shall mean any Flip-in Event or any Flip-over
Event.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, shall prior to the Distribution Date also
be the holders of the Common Stock) in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such appointment. The Company may
from time to time appoint such Co-Rights Agents as it may deem necessary or
desirable.
Section 3. Issuance of Rights Certificates.
(a) Distribution Date; Rights Certificates. Until the earlier of (i)
the Close of Business on the tenth Business Day after the Stock Acquisition Date
or (ii) the Close of Business on the tenth Business Day (or such later date as
the Board shall determine prior to such time as any Person becomes an Acquiring
Person) after the date that a tender or exchange offer by any Person (other than
the Company, any Subsidiary of the Company, any employee benefit plan of the
Company or of any Subsidiary of the Company, or any Person or entity organized,
appointed or established by the Company for or pursuant to the terms of any such
plan) is first published or sent or given within the meaning of Rule 14d-2(a) of
the General Rules and Regulations under the Exchange Act, if upon consummation
thereof such Person would be the Beneficial Owner of 15% or more of the shares
of Common Stock then outstanding (the earlier of (i) and (ii) being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the Company, except pursuant to
the provisions of Section 23 (Redemption and Termination)). As soon as
practicable after the Distribution Date, the Rights Agent will, at the expense
of the Company, send by first-class, postage prepaid mail, to each record holder
of the Common Stock as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the Company, one or more rights
certificates, in substantially the form of Exhibit 1 hereto (the "Rights
Certificates"), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock has been made pursuant to Section
11(p) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Common Stock Adjustments) at the time of distribution of the Rights
Certificates, the Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) (Fractional Rights and Fractional
Shares -- Fractional Rights)) so that Rights Certificates representing only
whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
6
(b) Common Stock Certificates; Summary of Rights. Prior to the
Distribution Date, the Rights as provided herein will be evidenced by such
certificates for the Common Stock and the registered holders of the Common Stock
shall also be the registered holders of such associated Rights. Until the
earlier of the Distribution Date or the Expiration Date, the transfer of any
certificates representing shares of Common Stock in respect of which Rights have
been issued shall also constitute the transfer of the Rights associated with
such shares of Common Stock. On the Effective Date, or as soon as practicable
thereafter, the Company will send a copy of a Summary of Rights to Purchase
Common Stock, in substantially the form of Exhibit 2 hereto (the "Summary of
Rights"), by first-class, postage-prepaid mail, to each record holder of shares
of Common Stock, at the address of such holder shown on the records of the
Company.
(c) Legend. Rights shall be issued in respect of all certificates for
shares of Common Stock which are issued (whether originally issued or from the
Company's treasury) after the Record Date but prior to the earliest of the (i)
Distribution Date, (ii) the Expiration Date, or (iii) the Effective Date, or, in
certain circumstances provided in Section 22 (Issuance of New Rights
Certificates) after the Distribution Date. Certificates representing such shares
of Common Stock shall also be deemed to be certificates for Rights, and shall
bear the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement dated as of
January 7, 1999 by and between Aztec Manufacturing Co. (the "Company")
and Xxxxxx Trust and Savings Bank, as Rights Agent (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of
the Company. Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate certificates and
will no longer be evidenced by this certificate. The Company will mail
to the holder of this certificate a copy of the Rights Agreement, as
in effect on the date of mailing, without charge promptly after
receipt of a written request therefor. Under certain circumstances set
forth in the Rights Agreement, Rights issued to, or held by, any
Person who is, was or becomes an Acquiring Person or any Affiliate or
Associate thereof (as such terms are defined in the Rights Agreement),
whether currently held by or on behalf of such Person or by any
subsequent holder, may become null and void.
With respect to such certificates containing the foregoing legend, until the
earliest of (i) the Distribution Date, (ii) the Expiration Date, and (iii) the
Redemption Date, (x) the Rights associated with the Common Stock represented by
such certificates shall be evidenced by such certificates alone, (y) the
registered holders of such Common Stock shall also be the registered holders of
the associated Rights, and (z) the transfer of any of such certificates shall
also constitute the transfer of the Rights associated with such shares of Common
Stock. In the event that the Company purchases, or acquires any shares of
Common Stock after the Record Date but prior to the Distribution Date, any
rights associated with such shares of Common Stock shall be deemed canceled and
retired so that the Company shall not be entitled to exercise any Rights
associated with shares of Common Stock which are no longer outstanding.
7
Section 4. Form of Rights Certificates.
(a) Form; Date. The Rights Certificates (and the forms of election to
purchase and of assignment to be printed on the reverse thereof) shall each be
substantially in the form set forth in Exhibit 1 hereto and may have such marks
of identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Rights may from time to
time be listed or any securities association on whose interdealer quotation
system the Rights may be from time to time authorized for quotation, or to
conform to usage. Subject to the provisions of Section 11 (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights) and Section 22
(Issuance of New Rights Certificates), the Rights Certificates, whenever
distributed, shall be dated as of the Record Date and on their face shall
entitle the holders thereof to purchase such number of shares of Common Stock as
shall be set forth therein at the price set forth therein (such exercise price
per share is referred to herein as the "Purchase Price"), but the amount and
type of securities purchasable upon the exercise of each Right and the Purchase
Price thereof shall be subject to adjustment as provided herein.
(b) Acquiring Person Legend. Any Rights Certificate issued pursuant
to Section 3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates) or Section 22 (Issuance of New Rights Certificates) that
represents Rights beneficially owned by (i) an Acquiring Person or any Associate
or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person with whom such Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights or (B) a transfer
which the Board has determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect avoidance of Section 7(e) (Exercise of
Rights; Purchase Price; Expiration Date of Rights -- Termination of Acquiring
Person's Rights) and any Rights Certificate issued pursuant to Section 6
(Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated,
Destroyed, Lost or Stolen Rights Certificates), Section 11 (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights) or Section 22
(Issuance of New Rights Certificates) upon transfer, exchange, replacement or
adjustment of any other Rights Certificate referred to in this sentence, shall
contain (to the extent feasible) the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement dated as of January 7, 1999, by and
between Aztec Manufacturing Co. and Xxxxxx Trust and Savings Bank, as
Rights Agent). Accordingly, this Rights Certificate and the Rights
represented hereby may become null and void in the circumstances
specified in Section 7(e) (Exercise of Rights;
8
Purchase Price; Expiration Date of Rights -- Termination of Acquiring
Person's Rights) of such Agreement.
Section 5. Countersignature and Registration.
(a) Signatures. The Rights Certificates shall be executed on behalf
of the Company by its Chairman of the Board, its President or any Vice
President, either manually or by facsimile signature, and shall have affixed
thereto the Company's seal or a facsimile thereof which shall be attested to by
the Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be countersigned by the
Rights Agent, either manually or by facsimile signature, and shall not be valid
for any purpose unless so countersigned. In case any officer of the Company who
shall have signed any of the Rights Certificates shall cease to be such officer
of the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Rights Certificates, nevertheless, may be
countersigned by the Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed such Rights
Certificates had not ceased to be such officer of the Company; and any Rights
Certificates may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights Certificate, although at the date of
the execution of this Agreement any such person was not such an officer.
(b) Registration and Transfer. Following the Distribution Date, the
Rights Agent will keep or cause to be kept, at its principal office or offices
designated as the appropriate place for surrender of Rights Certificates upon
exercise or transfer, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the names and addresses of
the respective holders of the Rights Certificates, the number of Rights
evidenced on its face by each of the Rights Certificates and the date of each of
the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
(a) Procedure. Subject to the provisions of Section 4(b) (Form of
Rights Certificates -- Acquiring Person Legend), Section 7(e) (Exercise of
Rights; Purchase Price; Expiration Date of Rights -- Termination of Acquiring
Person's Rights) and Section 14 (Fractional Rights and Fractional Shares), at
any time after the Close of Business on the Distribution Date, and at or prior
to the Close of Business on the Expiration Date, any Rights Certificate or
Certificates may be transferred, split up, combined or exchanged for another
Rights Certificate or Certificates, entitling the registered holder to purchase
a like number of shares of Common Stock (or, following a Triggering Event,
Common Stock, other securities, cash or other assets, as the case may be) as the
Rights Certificate or Certificates surrendered then entitle such holder (or
former holder in the case of a transfer) to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Rights Certificate or
Certificates shall make such request in writing delivered to the Rights Agent,
and shall surrender the Rights Certificate or Certificates to be transferred,
split up, combined or exchanged at the principal office or offices of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the Company
shall be obligated to take any action whatsoever with respect to the transfer of
any such surrendered Rights Certificate until the registered holder shall have
completed and signed the certificate contained in the form of assignment on the
reverse side of such Rights Certificate and shall have provided such additional
9
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request.
Thereupon, the Rights Agent shall, subject to Section 4(b), Section 7(e) and
Section 14, countersign and deliver to the Person entitled thereto a Rights
Certificate or Rights Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any transfer, split up,
combination or exchange of Rights Certificates.
(b) Issuance of New Rights Certificates. Upon receipt by the Company
and the Rights Agent of evidence reasonably satisfactory to them of the loss,
theft, destruction or mutilation of a Rights Certificate, and, in case of loss,
theft or destruction, of indemnity or security reasonably satisfactory to them,
and reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Rights Certificate if mutilated, the Company will execute and deliver a new
Rights Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered owner in lieu of the Rights Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) Exercise. Subject to Section 7(e) (Exercise of Rights; Purchase
Price; Expiration Date of Rights -- Termination of Acquiring Person's Rights),
at any time after the Distribution Date, the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein, including, without limitation, the restrictions on
exercisability set forth in Section 9(c) (Reservation and Availability of
Capital Stock -- Registration under the Act), Section 11(a)(iii) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Certain
Adjustments), Section 23(a) (Redemption and Termination -- Redemption), and
Section 24(b) (Exchange -- Effect of Exchange; Procedure)), in whole or in part,
upon surrender of the Rights Certificate, with the form of election to purchase
and the certificate on the reverse side thereof duly executed, to the Rights
Agent at the principal office or offices of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price with respect to
the total number of shares of Common Stock (or other securities, cash or other
assets, as the case may be) as to which such surrendered Rights are then
exercisable and an amount equal to any applicable transfer tax, at or prior to
the earliest of (i) the Final Expiration Date, (ii) the Redemption Date, or
(iii) the expiration of the Rights pursuant to Section 13(d) (Consolidation,
Merger or Sale or Transfer of Assets or Earning Power -- Exceptions) (the
earliest of (i), (ii) and (iii) being herein referred to as the "Expiration
Date"). The payment of the Purchase Price and the applicable transfer tax, if
any (as such amount may be reduced pursuant to Section 11(a)(iii) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Certain
Adjustments)), may be made (x) in cash, (y) by certified bank check or bank
draft payable to the order of the Company or (z) by delivery of a certificate or
certificates (with appropriate stock powers executed in blank attached thereto)
evidencing a number of shares of Common Stock equal to the then Purchase Price
divided by the closing price (as determined pursuant to Section 11(d)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Current Market Price)) per share of Common Stock on the Trading Day immediately
preceding the date of such exercise. In the event that the Company is obligated
to issue other securities (including Common Stock) of the Company, pay cash
and/or distribute other property pursuant to Section 11(a), the Company will
make all arrangements necessary so that such other securities, cash and/or other
property are available for distribution by the Rights Agent, if and when
appropriate. The Company
10
reserves the right to require prior to the occurrence of a Triggering Event
that, upon any exercise of Rights, a number of Rights be exercised so that only
whole shares of Common Stock would be issued.
(b) Purchase Price. The Purchase Price for each share of Common Stock
pursuant to the exercise of a Right shall initially be $60.00, and shall be
subject to adjustment from time to time as provided in Section 11 (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights) and Section 13(a)
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power -- Flip-
over Event) and shall be payable in accordance with paragraph (a) of this
Section 7.
(c) Rights Agent Actions. Upon receipt of a Rights Certificate
representing exercisable Rights and the compliance by the holder of such Rights
Certificate with paragraph (a) of this Section 7, the Rights Agent shall,
subject to Section 20(k) (Duties of Rights Agent -- Exercise of Rights;
Consultation with Company), thereupon promptly (i) (A) requisition from any
transfer agent of the shares of Common Stock (or make available, if the Rights
Agent is the transfer agent for such shares) certificates for the total number
of shares of Common Stock to be purchased and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests, or (B) if the
Company shall have elected to deposit the total number of shares of Common Stock
issuable upon exercise of the Rights hereunder with a depositary agent,
requisition from the depositary agent depositary receipts representing such
number of shares of Common Stock as are to be purchased (in which case
certificates for the shares of Common Stock represented by such receipts shall
be deposited by the transfer agent with the depositary agent) and the Company
will direct the depositary agent to comply with such request, (ii) requisition
from the Company the amount of cash, if any, to be paid in lieu of fractional
shares in accordance with Section 14 (Fractional Rights and Fractional Shares),
(iii) after receipt of such certificates or depositary receipts, cause the same
to be delivered to, or upon the order of, the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such
holder, and (iv) after receipt thereof, deliver such cash, if any, to, or upon
the order of, the registered holder of such Rights Certificate.
(d) Partial Exercise. In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced thereby, a new
Rights Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to, or upon the
order of the registered holder of such Rights Certificate, registered in such
name or names as may be designated by such holder, subject to the provisions of
Section 14 (Fractional Rights and Fractional Shares).
(e) Termination of Acquiring Person's Rights. Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence
of a Flip-in Event, any Rights beneficially owned by (i) an Acquiring Person, or
an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom the Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board
11
has determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 7(e), shall become null
and void without any further action and no holder of such Rights shall have any
rights whatsoever with respect to such Rights, whether under any provision of
this Agreement or otherwise. The Company shall use all reasonable efforts to
ensure that the provisions of this Section 7(e) and Section 4(b) (Form of Rights
Certificates -- Acquiring Person Legend) are complied with, but shall have no
liability to any holder of Rights Certificates or other Person as a result of
its failure to make any determinations with respect to an Acquiring Person or
any of its respective Affiliates, Associates or transferees hereunder.
(f) Surrender of Rights Certificates; Identity of Beneficial Owner.
Notwithstanding anything in this Agreement to the contrary, neither the Rights
Agent nor the Company shall be obligated to undertake any action with respect to
a registered holder upon the occurrence of any purported exercise as set forth
in this Section 7 unless such registered holder shall have (i) completed and
signed the certificate contained in the form of election to purchase set forth
on the reverse side of the Rights Certificate surrendered for such exercise, and
(ii) provided such additional evidence of the identity of the Beneficial Owner
(or former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request.
Section 8. Cancellation and Disposition of Rights Certificates. All
Rights Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall dispose of all
canceled Rights Certificates in accordance with its regulations and shall
deliver a certificate of such disposition thereof to the Company.
Section 9. Reservation and Availability of Capital Stock .
(a) Reservation of Capital Stock. The Company will use its best
efforts to reserve and keep available out of its authorized and unissued shares
of Common Stock the number of shares of Common Stock and/or other securities
that, as provided in this Agreement, including the rights of the Company under
Section 11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments) to otherwise fulfill its obligations,
will be sufficient to permit the exercise in full of all outstanding Rights.
(b) Listing. So long as the shares of Common Stock issuable and
deliverable upon the exercise of the Rights may be listed on any national
securities exchange or authorized for quotation on any interdealer quotation
system of any securities association, the Company shall use its best efforts to
cause, from and after such time as the Rights become exercisable, all shares
reserved for such issuance to be listed on such exchange or quoted on such
system upon official notice of issuance upon such exercise.
(c) Registration under the Act. The Company shall use its best
efforts to (i) file, as soon as practicable following the earliest date after
the first occurrence of a Flip-in Event on which the consideration to be
delivered by the Company upon exercise of the Rights has been
12
determined in accordance with Section 11(a)(iii) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Certain Adjustments), or as
soon as is required by law following the Distribution Date, as the case may be,
a registration statement on an appropriate form under the Act with respect to
the securities purchasable upon exercise of the Rights, (ii) cause such
registration statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Act) until the earlier
of (A) the date as of which the Rights are no longer exercisable for such
securities, and (B) the Expiration Date. The Company will also take such action
as may be appropriate under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights. The Company may temporarily suspend, for a period of time not to
exceed ninety (90) calendar days after the date set forth in clause (i) of the
first sentence of this Section 9(c), the exercisability of the Rights in order
to prepare and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is no
longer in effect. In addition, if the Company shall determine that a
registration statement is required following the Distribution Date, the Company
may temporarily suspend the exercisability of the Rights until such time as a
registration statement has been declared effective. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction if the requisite qualification in such jurisdiction shall
not have been obtained, the exercise thereof shall not be permitted under
applicable law or a registration statement, if required, shall not have been
declared effective.
(d) Covenant Regarding Capital Stock. The Company will take all such
action as may be necessary to ensure that all shares of Common Stock (and,
following the occurrence of a Triggering Event, Common Stock and/or other
securities) delivered upon exercise of Rights shall, at the time of delivery of
the certificates for such shares (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and nonassessable.
(e) Transfer Taxes and Charges. The Company will pay when due and
payable any and all federal and state transfer taxes and charges which may be
payable in respect of the issuance or delivery of the Rights Certificates and of
any certificates for a number of shares of Common Stock (or other securities, as
the case may be) upon the exercise of Rights. The Company shall not, however, be
required to pay any transfer tax which may be payable in respect of any transfer
or delivery of Rights Certificates to a Person other than, or the issuance or
delivery of shares of Common Stock (or other securities, as the case may be) in
respect of a name other than, that of the registered holder of the Rights
Certificates evidencing Rights surrendered for exercise or to issue or deliver
any certificates for shares of Common Stock (or other securities, as the case
may be) in a name other than that of the registered holder upon the exercise of
any Rights until such tax shall have been paid (any such tax being payable by
the holder of such Rights Certificate at the time of surrender) or until it has
been established to the Company's satisfaction that no such tax is due.
Section 10. Common Stock Record Date. Each Person in whose name any
certificate for a number of shares of Common Stock (or other securities, as the
case may be) is issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of such shares of Common Stock (or
other securities, as the case may be) represented thereby on, and such
certificate shall be dated as of, the date upon which the Rights Certificate
evidencing such
13
Rights was duly surrendered and payment of the Purchase Price (and all
applicable transfer taxes) was made; provided, however, that if the date of such
surrender and payment is a date upon which the Common Stock (or other
securities, as the case may be) transfer books of the Company are closed, such
Person shall be deemed to have become the record holder of such shares
(fractional or otherwise) on, and such certificate shall be dated, the next
succeeding Business Day on which the Common Stock (or other securities, as the
case may be) transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Rights Certificate shall not be
entitled to any rights of a shareholder of the Company with respect to shares
for which the Rights shall be exercisable, including, without limitation, the
right to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights. The Purchase Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) Certain Adjustments.
(i) In the event the Company shall at any time after the date
of this Agreement (A) declare a dividend on the Common Stock payable in
shares of Common Stock, (B) subdivide or split the outstanding Common
Stock, (C) combine the outstanding Common Stock into a smaller number of
shares, or (D) issue any shares of its capital stock in a reclassification
of the Common Stock (including any such reclassification in connection with
a consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this Section 11(a)
and Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date of
Rights -- Termination of Acquiring Person's Rights), the Purchase Price in
effect at the time of the record date for such dividend or of the effective
date of such subdivision, split, combination or reclassification, and the
number and kind of shares of Common Stock or capital stock, as the case may
be, issuable on such date, shall be proportionately adjusted so that the
holder of any Right exercised after such time shall be entitled to receive,
upon payment of the aggregate adjusted Purchase Price then in effect
necessary to exercise a Right in full, the aggregate number and kind of
shares of Common Stock or capital stock, as the case may be, which, if such
Right had been exercised immediately prior to such date and at a time when
the Common Stock (or other capital stock, as the case may be) transfer
books of the Company were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend,
subdivision, split, combination or reclassification. If an event occurs
which would require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii), the adjustment provided for in this Section 11(a)(i)
shall be in addition to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii).
(ii) In the event:
(A) (1) any Acquiring Person or any Associate or
Affiliate of any Acquiring Person, at any time after the date of this
Agreement, directly or indirectly, shall merge into the Company or
otherwise combine with the Company and the Company shall be the
continuing or surviving corporation of such merger or combination and
the Common Stock of the Company shall remain outstanding and
14
unchanged, or (2) subject to Section 23 (Redemption and Termination),
any Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any Subsidiary of the
Company, or any Person or entity organized, appointed or established
by the Company for or pursuant to the terms of any such plan), alone
or together with its Affiliates and Associates, shall, at any time
after the Rights Dividend Declaration Date, become an Acquiring
Person, unless the event causing such Person to become an Acquiring
Person is a Flip-over Event, or is an acquisition of shares of Common
Stock pursuant to a tender offer or an exchange offer for all
outstanding shares of Common Stock at a price and on terms determined
by a majority of the Disinterested Directors after receiving advice
from one or more investment banking firms selected by the
Disinterested Directors, to be (a) at a price which is fair to the
shareholders of the Company (taking into account all factors which the
Disinterested Directors deem relevant including, without limitation,
prices which could reasonably be achieved if the Company or its assets
were sold on an orderly basis designed to realize maximum value) and
(b) otherwise in the best interests of the Company and its
shareholders, other than such Acquiring Person, its Affiliates and its
Associates (a "Qualified Offer"); or
(B) during such time as there is an Acquiring Person,
there shall be any reclassification of securities (including any
reverse stock split), or recapitalization of the Company, or any
merger or consolidation of the Company with any of its Subsidiaries or
any other transaction or series of transactions involving the Company
or any of its Subsidiaries, other than a transaction or transactions
to which the provisions of Section 13(a) (Consolidation, Merger or
Sale or Transfer of Assets or Earning Power -- Flip-over Event) apply
(whether or not with or into or otherwise involving an Acquiring
Person) which has the effect, directly or indirectly, of increasing by
more than 1% the proportionate share of the outstanding shares of any
class of equity securities of the Company or any of its subsidiaries
which is directly or indirectly beneficially owned by any Acquiring
Person or any Associate or Affiliate of any Acquiring Person, then,
promptly following the occurrence of any such Flip-in Event (whether
described in Section 11(a)(ii)(A) or (B)), proper provision shall be
made so that each holder of a Right (except as provided below and in
Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date of
Rights -- Termination of Acquiring Person's Rights)) shall thereafter
have the right to receive, upon exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement, in lieu
of the number of shares of Common Stock for which a Right was before
that time exercisable, such number of shares of Common Stock of the
Company as shall equal the result obtained by (x) multiplying the then
current Purchase Price by the then number of shares of Common Stock
for which a Right was exercisable immediately prior to the first
occurrence of a Flip-in Event, and (y) dividing that product (which,
following such first occurrence, shall thereafter be referred to as
the "Purchase Price" for each Right and for all purposes of this
Agreement) by 50% of the Current Market Price per share of Common
Stock on the date of such first occurrence (such number of shares
being referred to as the "Adjustment Shares").
(iii) In the event that the number of shares of Common Stock
that are authorized by the Company's Articles of Incorporation but not
outstanding or reserved for
15
issuance for purposes other than upon exercise of the Rights is not
sufficient to permit the exercise in full of the Rights in accordance with
the foregoing subparagraph (ii) of this Section 11(a), the Company shall:
(A) determine the excess of (1) the value of the Adjustment Shares issuable
upon the exercise of a Right (the "Current Value") over (2) the Purchase
Price (such excess, the "Spread"), and (B) with respect to each Right,
subject to Section 7(e)(Exercise of Rights; Purchase Price; Expiration Date
of Rights --Termination of Acquiring Person's Rights), make adequate
provision to substitute for the Adjustment Shares, upon the exercise of
such Right and payment of the applicable Purchase Price, (1) cash, (2) a
reduction in the Purchase Price, (3) other equity securities of the Company
(including, without limitation, shares, or units of shares, of preferred
stock which the Board has deemed to have essentially the same value or
economic rights as shares of Common Stock (such securities being referred
to as "Common Stock Equivalents")), (4) debt securities of the Company, (5)
other assets, or (6) any combination of the foregoing, having an aggregate
value equal to the Current Value (less the amount of any reduction in the
Purchase Price), where such aggregate value has been determined by the
Board based upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, that if the Company shall
not have made adequate provision to deliver value pursuant to clause (B)
above within thirty (30) calendar days following the later of (x) the first
occurrence of a Flip-in Event and (y) the date on which the Company's right
of redemption pursuant to Section 23(a) (Redemption and Termination --
Redemption) expires (the later of (x) and (y) being referred to herein as
the "Flip-in Trigger Date"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without requiring
payment of the Purchase Price, shares of Common Stock (to the extent
available) and then, if necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board shall determine in good
faith that it is likely that sufficient additional shares of Common Stock
or other equity securities could be authorized for issuance upon exercise
in full of the Rights, the thirty (30) calendar day period set forth above
may be extended to the extent necessary, but not more than ninety (90)
calendar days after the Flip-in Trigger Date, in order that the Company may
seek shareholder approval for the authorization of such additional shares
(such period, as it may be extended, the "Substitution Period"). To the
extent that the Company determines that some action need be taken pursuant
to the first and/or second sentences of this Section 11(a)(iii), the
Company (x) shall provide, subject to Section 7(e), that such action shall
apply uniformly to all outstanding Rights, and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution
Period in order to seek any authorization of additional shares of Common
Stock or other equity securities and/or to decide the appropriate form of
distribution to be made pursuant to such first sentence and to determine
the value thereof. In the event of any such suspension, the Company shall
issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect. For purposes of this Section
11(a)(iii), the value of each Adjustment Share shall be the Current Market
Price per share of the Common Stock on the Flip-in Trigger Date and the per
share or per unit value of any Common Stock Equivalent shall be deemed to
equal the Current Market Price per share of the Common Stock on such date.
(iv) If the rules of the national securities exchange,
registered as such pursuant to Section 6 of the Exchange Act, or of the
national securities association, registered as such pursuant to Section 15A
of the Exchange Act, on which the Common
16
Stock is principally traded or quoted would prohibit such exchange or
association from listing or continuing to list, or from authorizing for or
continuing quotation and/or transaction reporting through an inter-dealer
quotation system, the Common Stock or other equity securities of the
Company if the Rights were to be exercised for shares of Common Stock in
accordance with subparagraph (ii) of this Section 11(a) because such
issuance would nullify, restrict or disparately reduce the per share voting
rights of holders of Common Stock, the Company shall: (A) determine the
Spread, and (B) with respect to each Right, make adequate provision to
substitute for the Adjustment Shares, upon payment of the applicable
Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3) equity
securities of the Company, including, without limitation, Common Stock
Equivalents, other than securities which would have the effect of
nullifying, restricting or disparately reducing the per share voting rights
of holders of Common Stock, (4) debt securities of the Company, (5) other
assets, or (6) any combination of the foregoing, having an aggregate value
equal to the Current Value, where such aggregate value has been determined
by the Board based upon the advice of a recognized investment banking firm
selected by the Board; provided, however, if the Company shall not have
made adequate provision to deliver value pursuant to clause (B) above
within thirty (30) calendar days following the Flip-in Trigger Date, then
the Company shall be obligated to deliver, upon the surrender for exercise
of a Right and without requiring payment of the Purchase Price, cash having
an aggregate value equal to the Spread. To the extent that the Company
determines that some action need be taken pursuant to the first sentence of
this Section 11(a)(iv), the Company (x) shall provide, subject to Section
7(e) (Exercise of Rights; Purchase Price; Expiration Date of Rights --
Termination of Acquiring Person's Rights), that such action shall apply
uniformly to all outstanding Rights and (y) may suspend the exercisability
of the Rights, but not longer than ninety (90) calendar days after the
Flip-in Trigger Date, in order to decide the appropriate form of
distribution to be made pursuant to such first sentence and to determine
the value thereof. In the event of any such suspension, the Company shall
issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect. For purposes of this Section
11(a)(iv), the value of the Common Stock shall be the Current Market Price
per share of the Common Stock on the Flip-in Trigger Date and the value of
any Common Stock Equivalent shall be deemed to have the same value as the
Common Stock on such date.
(b) Purchase Price Adjustment -- Capital Stock. In case the Company
shall fix a record date for the issuance of rights, options or warrants to all
holders of Common Stock entitling them to subscribe for or purchase (for a
period expiring within forty-five (45) calendar days after such record date)
Common Stock, Common Stock Equivalents or securities convertible into Common
Stock or Common Stock Equivalents at a price per share of Common Stock (or
having a conversion price per share, if a security convertible into Common Stock
or Common Stock Equivalents) less than the Current Market Price per share of
Common Stock on such record date, the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Common Stock outstanding on such record date,
plus the number of shares of Common Stock which the aggregate offering price of
the total number of shares of Common Stock and/or Common Stock Equivalents so to
be offered (and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such Current Market Price, and
the denominator of which shall be the number of shares of Common Stock
17
outstanding on such record date, plus the number of additional shares of Common
Stock and/or Common Stock Equivalents to be offered for subscription or purchase
(or into which the convertible securities so to be offered are initially
convertible). In case such subscription price may be paid by delivery of
consideration part or all of which may be in a form other than cash, the value
of such consideration shall be as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights Agent and
shall be binding on the Rights Agent and the holders of the Rights. Shares of
Common Stock owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall be
made successively whenever such a record date is fixed, and in the event that
such rights or warrants are not so issued, the Purchase Price shall be adjusted
to be the Purchase Price which would then be in effect if such record date had
not been fixed.
(c) Purchase Price Adjustment -- Cash, Assets, etc. In case the
Company shall fix a record date for a distribution to all holders of Common
Stock (including any such distribution made in connection with a consolidation
or merger in which the Company is the continuing corporation) of evidences of
indebtedness, cash (other than a regular quarterly cash dividend out of the
earnings or retained earnings of the Company), assets (other than a dividend
payable in Common Stock, but including any dividend payable in stock other than
Common Stock) or subscription rights or warrants (excluding those referred to in
Section 11(b) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights Purchase Price Adjustment -- Capital Stock)), the Purchase Price to be
in effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the Current Market Price per share of Common Stock
on such record date, less the fair market value (as determined in good faith by
the Board, whose determination shall be described in a statement filed with the
Rights Agent) of the portion of the cash, assets or evidences of indebtedness so
to be distributed or of such subscription rights or warrants applicable to a
share of Common Stock and the denominator of which shall be such Current Market
Price per share of Common Stock. Such adjustments shall be made successively
whenever such a record date is fixed, and in the event that such distribution is
not so made, the Purchase Price shall be adjusted to be the Purchase Price which
would have been in effect if such record date had not been fixed.
(d) Current Market Price. For the purpose of any computation
hereunder, other than computations made pursuant to Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments) the Current Market Price per share of Common Stock on any
date shall be deemed to be the average of the daily closing prices per share of
such Common Stock for the thirty (30) consecutive Trading Days immediately prior
to such date, and for purposes of computations made pursuant to Section
11(a)(iii) the Current Market Price per share of Common Stock on any date shall
be deemed to be the average of the daily closing prices per share of such Common
Stock for the ten (10) consecutive Trading Days immediately following such date;
provided, however, that in the event that the Current Market Price per share of
the Common Stock is determined during a period following the announcement by the
issuer of such Common Stock of (A) a dividend or distribution on such Common
Stock payable in shares of such Common Stock or securities convertible into
shares of such Common Stock (other than the Rights), or (B) any subdivision,
combination or reclassification of such Common Stock and the ex-dividend date
for such dividend or distribution, or the record date for such subdivision,
combination or reclassification shall not have occurred prior to the
commencement of the requisite thirty (30) Trading Day or ten (10) Trading Day
period, as set forth above, then, and in each such case, the
18
Current Market Price shall be properly adjusted to take into account ex-dividend
trading. The closing price for each Trading Day shall be the last sale price,
regular way, or, in case no such sale takes place on such Trading Day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the shares of Common Stock are not listed or admitted to trading on the New
York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading or, if the shares of Common Stock are not listed or admitted to
trading on any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities Dealers, Inc.
Automated Quotation System ("Nasdaq") or such other system then in use, or, if
on any such date the shares of Common Stock are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Common Stock selected by the
Board. If on any such date no market maker is making a market in the Common
Stock, the fair value of such shares on such date as determined in good faith by
the Board shall be used. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the shares of Common Stock are
listed or admitted to trading is open for the transaction of business or, if the
shares of Common Stock are not listed or admitted to trading on any national
securities exchange, a Business Day. If the Common Stock is not publicly held or
not so listed or traded, Current Market Price per share shall mean the fair
value per share as determined in good faith by the Board, whose determination
shall be described in a statement filed with the Rights Agent and shall be
conclusive for all purposes.
(e) Purchase Price Adjustment Threshold. Anything herein to the
contrary notwithstanding, no adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least one
percent (1%) in the Purchase Price; provided however, that any adjustments which
by reason of this Section 11(e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 11 (Adjustment of Purchase Price; Number and Kind of Shares
or Number of Rights) shall be made to the nearest cent or to the nearest share
of Common Stock, as the case may be. Notwithstanding the first sentence of this
Section 11(e), any adjustment required by this Section 11 shall be made no later
than the earlier of (i) three (3) years from the date of the transaction which
mandates such adjustment, or (ii) the Expiration Date.
(f) Equivalent Adjustments. If as a result of an adjustment made
pursuant to Section 11(a)(ii) (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights -- Certain Adjustments) or Section 13(a)
(Consolidation Merger or Sale or Transfer of Assets or Earning Power -- Flip-
over Event) the holder of any Right thereafter exercised shall become entitled
to receive any shares of capital stock other than Common Stock, thereafter the
number of such other shares so receivable upon exercise of any Right and the
Purchase Price thereof shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in Sections 11(a), (b), (c), (e), (g),
(h), (i), (j), (k) and (m), and the provisions of Sections 7, 9, 10, 13 and 14
with respect to the Common Stock shall apply on like terms to any such other
shares.
(g) Post-Adjustment Rights Issuances. All Rights originally issued by
the Company subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the
19
right to purchase, at the adjusted Purchase Price, the number of shares of
Common Stock purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Common Stock Anti-Dilution. Unless the Company shall have
exercised its election as provided in Section 11(i) (Adjustment of Purchase
Price; Number and Kind of Shares or Number of Rights -- Adjustment of Number of
Rights), upon each adjustment of the Purchase Price as a result of the
calculations made in Section 11(b) (Adjustment of Purchase Price; Number and
Kind of Shares or Number of Rights -- Purchase Price Adjustment -- Capital
Stock) and Section 11(c) (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights --Purchase Price Adjustment -- Cash, Assets, etc.),
each Right outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase Price, that
number of shares of Common Stock (calculated to the nearest whole share)
obtained by (i) multiplying (x) the number of shares covered by a Right
immediately prior to this adjustment, by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price, and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) Adjustment of Number of Rights. The Company may elect on or after
the date of any adjustment of the Purchase Price to adjust the number of Rights,
in lieu of any adjustment in the number of shares of Common Stock purchasable
upon the exercise of a Right. Each of the Rights outstanding after the
adjustment in the number of Rights shall be exercisable for the number of shares
of Common Stock for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number of
Rights shall become that number of Rights (calculated to the nearest one-ten-
thousandth) obtained by dividing the Purchase Price in effect immediately prior
to adjustment of the Purchase Price by the Purchase Price in effect immediately
after adjustment of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Rights Certificates have
been issued, shall be at least ten (10) calendar days later than the date of the
public announcement. If Rights Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the Company
shall, as promptly as practicable, cause to be distributed to holders of record
of Rights Certificates on such record date Rights Certificates evidencing,
subject to Section 14 (Fractional Rights and Fractional Shares) the additional
Rights to which such holders shall be entitled as a result of such adjustment,
or, at the option of the Company, shall cause to be distributed to such holders
of record in substitution and replacement for the Rights Certificates held by
such holders prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Rights Certificates evidencing all the Rights to
which such holders shall be entitled after such adjustment. Rights Certificates
so to be distributed shall be issued, executed and countersigned in the manner
provided for herein (and may bear, at the option of the Company, the adjusted
Purchase Price) and shall be registered in the names of the holders of record of
Rights Certificates on the record date specified in the public announcement.
(j) Rights Certificates. Irrespective of any adjustment or change in
the Purchase Price or the number of shares of Common Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Purchase Price
20
per share and the number of shares which were expressed in the initial Rights
Certificates issued hereunder.
(k) Adjustment Below Par Value. Before taking any action that would
cause an adjustment reducing the Purchase Price below the then par or stated
value, if any, of the number of shares of Common Stock issuable upon exercise of
the Rights, the Company shall take any corporate action which is or may, in the
opinion of its counsel, be necessary in order that the Company may validly and
legally issue fully paid and nonassessable such number of shares of Common Stock
at such adjusted Purchase Price.
(l) Adjustment Effective as of Future Date; Exercise. In any case in
which this Section 11 (Adjustment of Purchase Price; Number and Kind of Shares
or Number of Rights) shall require that an adjustment in the Purchase Price be
made effective as of a record date for a specified event, the Company may elect
to defer until the occurrence of such event the issuance to the holder of any
Right exercised after such record date the number of shares of Common Stock and
other capital stock or securities of the Company, if any, issuable upon such
exercise over and above the number of shares of Common Stock and other capital
stock or securities of the Company, if any, issuable upon such exercise on the
basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such additional
shares (fractional or otherwise) or securities upon the occurrence of the event
requiring such adjustment.
(m) Tax Adjustments. Anything in this Section 11 (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights) to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that in its good faith judgment the Board shall
determine to be advisable in order that any (i) consolidation or subdivision of
the Common Stock, (ii) issuance wholly for cash of any shares of Common Stock at
less than the Current Market Price, (iii) issuance wholly for cash of shares of
Common Stock or securities which by their terms are convertible into or
exchangeable for shares of Common Stock, (iv) stock dividends or (v) issuance of
rights, options or warrants referred to in this Section 11, hereafter made by
the Company to holders of its Common Stock shall not be taxable to such
shareholders.
(n) Restriction on Certain Transactions. The Company shall not, at
any time after the Distribution Date, (i) consolidate with any other Person
(other than a Subsidiary of the Company in a transaction which complies with
Section 11(o) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights --Restriction Against Diminishing Benefits of the Rights)), (ii) merge
with or into any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o)), (iii) enter into a statutory
share exchange or similar transaction with any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(o)),
or (iv) sell or transfer (or permit any Subsidiary to sell or transfer), in one
transaction, or a series of related transactions, assets, cash flow or earning
power aggregating more than 50% of the assets, cash flow or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company and/or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(o)), if (x) at the time of
or immediately after such consolidation, merger, statutory share exchange or
similar transaction, or sale there are any rights, warrants or other instruments
or securities outstanding or agreements in effect which would substantially
diminish or otherwise eliminate the benefits intended to be afforded by the
21
Rights or (y) prior to, simultaneously with or immediately after such
consolidation, merger, statutory share exchange or similar transaction, or sale,
the shareholders of the Person who constitutes, or would constitute, the
"Principal Party" for purposes of Section 13(a) (Consolidation, Merger or Sale
or Transfer of Assets or Earning Power -- Flip-over Event) shall have received a
distribution of Rights previously owned by such Person or any of its Affiliates
and Associates.
(o) Restriction Against Diminishing Benefits of the Rights. The
Company covenants and agrees that, after the Distribution Date, it will not,
except as permitted by Section 23 (Redemption and Termination) or Section 27
(Supplements and Amendments) take (or permit any Subsidiary to take) any action
if at the time such action is taken it is reasonably foreseeable that such
action will diminish substantially or otherwise eliminate the benefits intended
to be afforded by the Rights.
(p) Common Stock Adjustments. Anything in this Agreement to the
contrary notwithstanding, in the event that the Company shall at any time after
the Rights Dividend Declaration Date and prior to the Distribution Date (i)
declare a dividend on the outstanding shares of Common Stock payable in shares
of Common Stock, (ii) subdivide or split the outstanding shares of Common Stock,
or (iii) combine the outstanding shares of Common Stock into a smaller number of
shares, the number of Rights associated with each share of Common Stock then
outstanding, or issued or delivered thereafter but prior to the Distribution
Date, shall be proportionately adjusted so that the number of Rights thereafter
associated with each share of Common Stock following any such event shall equal
the result obtained by multiplying the number of Rights associated with each
share of Common Stock immediately prior to such event by a fraction, the
numerator of which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and the denominator
of which shall be the total number of shares of Common Stock outstanding
immediately following the occurrence of such event. The adjustments provided for
in this Section 11(p) shall be made successively whenever such a dividend is
declared or paid or such subdivision, combination or consolidation is effected.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 (Adjustment of Purchase
Price; Number and Kind of Shares or Number of Rights) and Section 13
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power) the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent, and with each transfer agent for the Common Stock, a
copy of such certificate, and (c) mail or cause the Rights Agent to mail a brief
summary thereof to each holder of a Rights Certificate (or, if prior to the
Distribution Date, to each holder of a certificate representing shares of Common
Stock) in accordance with Section 26 (Notices). The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained, and shall not be responsible for calculating any adjustment, nor
shall it be deemed to have knowledge of such an adjustment unless and until it
shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power.
(a) Flip-over Event. In the event that, following the Stock
Acquisition Date, directly or indirectly, (x) the Company shall consolidate
with, or merge with and into, or enter into a statutory stock exchange or
similar transaction with, any other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o)(Adjustment of
Purchase Price;
22
Number and Kind of Shares or Number of Rights -- Restriction Against Diminishing
Benefits of the Rights)), and the Company shall not be the continuing or
surviving corporation of such consolidation, merger or statutory share exchange
or similar transaction, (y) any Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o)) shall consolidate with, or
merge with or into, or enter into a statutory stock exchange or similar
transaction with, the Company, and the Company shall be the continuing or
surviving corporation of such consolidation, merger or statutory share exchange
or similar transaction and, in connection with such consolidation, merger or
statutory share exchange or similar transaction, all or part of the outstanding
shares of Common Stock shall be changed into or exchanged for stock or other
securities of any other Person or cash or any other property, or (z) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one transaction or a series of related transactions,
assets, cash flow or earning power aggregating more than 50% of the assets, cash
flow or earning power of the Company and its Subsidiaries (taken as a whole) to
any Person or Persons (other than the Company or any Subsidiary of the Company
in one or more transactions each of which complies with Section 11(o)), then,
and in each such case (except as may be contemplated by Section 13(d)
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Exceptions)), proper provision shall be made so that: (i) each holder of a
Right, except as provided in Section 7(e) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Termination of Acquiring Person's Rights) shall
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement, such
number of validly authorized and issued, fully paid, nonassessable and freely
tradeable shares of Common Stock of the Principal Party, not subject to any
liens, encumbrances, rights of first refusal or other adverse claims, as shall
be equal to the result obtained by (A) multiplying the then current Purchase
Price by the number of shares of Common Stock for which a Right is exercisable
immediately prior to the first occurrence of a Flip-over Event (or, if a Flip-in
Event has occurred prior to the first occurrence of a Flip-over Event,
multiplying the number of such shares for which a Right was exercisable
immediately prior to the first occurrence of a Flip-in Event by the Purchase
Price in effect immediately prior to such first occurrence), and (B) dividing
that product (which, following the first occurrence of a Flip-over Event, shall
be referred to as the "Purchase Price" for each Right and for all purposes of
this Agreement) by 50% of the Current Market Price per share of the Common Stock
of such Principal Party on the date of consummation of such Flip-over Event;
(ii) such Principal Party shall thereafter be liable for, and shall assume, by
virtue of such Flip-over Event, all the obligations and duties of the Company
pursuant to this Agreement; (iii) the term "Company" shall thereafter be deemed
to refer to such Principal Party, it being specifically intended that the
provisions of Section 11 (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights) shall apply only to such Principal Party following
the first occurrence of a Flip-over Event; (iv) such Principal Party shall take
such steps (including, but not limited to, the reservation of a sufficient
number of shares of its Common Stock) in connection with the consummation of any
such transaction as may be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in relation to its
shares of Common Stock thereafter deliverable upon the exercise of the Rights;
and (v) the provisions of Section 11(a)(ii) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Certain Adjustments) hereof
shall be of no effect following the first occurrence of any Flip-over Event.
23
(b) Principal Party. "Principal Party" shall mean
(i) in the case of any transaction described in clause (x) or
(y) of the first sentence of Section 13(a) (Consolidation, Merger or Sale
or Transfer of Assets or Earning Power -- Flip-over Event), the Person that
is the issuer of any securities into which shares of Common Stock of the
Company are converted in such consolidation, merger or statutory share
exchange or similar transaction, and if no securities are so issued, the
Person that is the other party to such consolidation, merger or statutory
share exchange or similar transaction, and
(ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a) (Consolidation, Merger or Sale or
Transfer of Assets or Earning Power -- Flip-over Event), the Person that is
the party receiving the greatest portion of the assets, cash flow or
earning power transferred pursuant to such transaction or transactions;
provided, however, that in any such case, (1) if the Common Stock of such Person
is not at such time and has not been continuously over the preceding twelve (12)
month period registered under Section 12 of the Exchange Act, and such Person is
a direct or indirect Subsidiary of another Person the Common Stock of which is
and has been so registered, "Principal Party" shall refer to such other Person;
and (2) in case such Person is a Subsidiary, directly or indirectly, of more
than one Person, the Common Stocks of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the total outstanding Common Stock having the greatest aggregate
market value.
(c) Supplemental Agreement. The Company shall not consummate a Flip-
over Event unless the Principal Party shall have a sufficient number of
authorized shares of its Common Stock which have not been issued or reserved for
issuance to permit the exercise in full of the Rights in accordance with this
Section 13 (Consolidation, Merger or Sale or Transfer of Assets or Earning
Power) and unless prior thereto the Company and such Principal Party shall have
executed and delivered to the Rights Agent a supplemental agreement providing
for the terms set forth in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of such Flip-over Event,
the Principal Party will
(i) prepare and file a registration statement under the Act,
with respect to the Rights and the securities purchasable upon exercise of
the Rights on an appropriate form, and will use its best efforts to cause
such registration statement to (A) become effective as soon as practicable
after such filing and (B) remain effective (with a prospectus at all times
meeting the requirements of the Act) until the Expiration Date;
(ii) take all such other action as may be necessary to enable
the Principal Party to issue the securities purchasable upon exercise of
the Rights, including but not limited to the registration or qualification
of such securities under all requisite securities laws of jurisdictions of
the various states and the listing of such securities on such exchanges and
trading markets as may be necessary or appropriate; and
24
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates that comply
in all respects with the requirements for registration on Form 10 under the
Exchange Act.
The provisions of this Section 13 (Consolidation, Merger or Sale or Transfer of
Assets or Earning Power) shall similarly apply to successive consolidation,
mergers or statutory share exchanges or similar transactions or sales or other
transfers. In the event that a Flip-over Event shall occur at any time after the
occurrence of a Flip-in Event, the Rights which have not theretofore been
exercised shall thereafter become exercisable in the manner described in Section
13(a) (Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Flip-over Event).
(d) Exceptions. Notwithstanding anything in this Agreement to the
contrary, Section 13 (Consolidation, Merger or Sale or Transfer of Assets or
Earning Power) shall not be applicable to a transaction described in
subparagraphs (x) and (y) of Section 13(a) (Consolidation, Merger or Sale or
Transfer of Assets or Earning Power -- Flip-over Event) if (i) such transaction
is consummated with a Person or Persons who acquired shares of Common Stock
pursuant to a tender offer or exchange offer for all outstanding shares of
Common Stock that is a Qualified Offer (or a wholly-owned subsidiary of any such
Person or Persons), (ii) the price per share of Common Stock offered in such
transaction is not less than the price per share of Common Stock paid to all
holders of shares of Common Stock whose shares were purchased pursuant to such
tender or exchange offer and (iii) the form of consideration being offered in
such transaction is the same as the form of consideration paid to all holders of
shares of Common Stock whose shares were purchased pursuant to such tender offer
or exchange offer. Upon consummation of any such transaction contemplated by
this Section 13(d), all Rights hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
(a) Fractional Rights. The Company shall not be required to issue
fractions of Rights, except prior to the Distribution Date as provided in
Section 11(p) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights -- Common Stock Adjustments), or to distribute Rights Certificates
which evidence fractional Rights. In lieu of such fractional Rights, there shall
be paid to the registered holders of the Rights Certificates with regard to
which such fractional Rights would otherwise be issuable, an amount in cash
equal to the same fraction of the current market value of a whole Right. For
purposes of this Section 14(a), the current market value of a whole Right shall
be the closing price of the Rights for the Trading Day immediately prior to the
date on which such fractional Rights would have been otherwise issuable. The
closing price of the Rights for any Trading Day shall be the last sale price,
regular way, or, in case no such sale takes place on such Trading Day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading, or if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market as reported by Nasdaq or such other system
then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board.
If on any such date no such
25
market maker is making a market in the Rights, the fair value of the Rights on
such date as determined in good faith by the Board shall be used.
(b) Fractional Shares of Common Stock. Following the occurrence of a
Triggering Event, the Company shall not be required to issue fractions of shares
of Common Stock upon exercise of the Rights or to distribute certificates which
evidence fractional shares of Common Stock. In lieu of fractional shares of
Common Stock, the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market value of one (1) share
of Common Stock. For purposes of this Section 14(c), the current market value of
one share of Common Stock shall be the closing price of one share of Common
Stock (as determined pursuant to Section 11(d)(i) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Current Market Price)) for the
Trading Day immediately prior to the date of such exercise.
(c) Waiver of Fractional Rights and Shares. The holder of a Right by
the acceptance of the Right expressly waives his or her right to receive any
fractional Rights or any fractional shares upon exercise of a Right, except as
permitted by this Section 14 (Fractional Rights and Fractional Shares).
Section 15. Rights of Action. All rights of action in respect of this
Agreement are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Rights Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Rights Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in his or her own behalf and for
his or her own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company to enforce, or otherwise act in respect of,
his or her right to exercise the Rights evidenced by such Rights Certificate in
the manner provided in such Rights Certificate and in this Agreement. Without
limiting the foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief against actual or
threatened violations of the obligations hereunder of any Person subject to this
Agreement.
Section 16. Agreement of Rights Holders.. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer and
with the appropriate forms and certificates fully executed;
(c) subject to Section 6(a) (Transfer, Split Up, Combination and
Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates-- Procedure) and Section 7(f) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Surrender of Rights
26
Certificates; Identity of Beneficial Owner), the Company and the Rights Agent
may deem and treat the person in whose name a Rights Certificate (or, prior to
the Distribution Date, the associated Common Stock certificate) is registered as
the absolute owner thereof and of the Rights evidenced thereby (notwithstanding
any notations of ownership or writing on the Rights Certificates or the
associated Common Stock certificate made by anyone other than the Company or the
Rights Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent, subject to the last sentence of Section 7(e) (Exercise of Rights;
Purchase Price; Expiration Date of Rights --Termination of Acquiring Person's
Rights), shall be required to be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use its best
efforts to have any such order, decree or ruling lifted or otherwise overturned
as soon as possible.
Section 17. Rights Certificate Holder Not Deemed a Shareholder. No
holder, as such, of any Rights Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the number of shares of
Common Stock or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Rights Certificate be construed to confer upon the
holder of any Rights Certificate, as such, any of the rights of a shareholder of
the Company or any right to vote for the election of directors or upon any
matter submitted to shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting shareholders (except as provided in Section 25 (Notice of
Certain Events)), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by such Rights Certificate shall have been
exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) Compensation. The Company shall pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder and, from time
to time, on demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The Company
agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability or expense, incurred without negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted to be
done by the Rights Agent in connection with the acceptance and administration of
this Agreement, including the costs and expenses of defending against any claim
of liability in the premises. The indemnity provided for herein shall survive
the expiration of the Rights, the termination of this Agreement, and the
resignation or removal of the Rights Agent. The costs and expenses of enforcing
this right of indemnification shall also be paid by the Company.
27
(b) Reliance. The Rights Agent may conclusively rely upon and shall
be protected and shall incur no liability for or in respect of any action taken,
suffered or omitted to be taken by it in connection with its administration of
this Agreement in reliance upon any Rights Certificate or certificate for Common
Stock or for other securities of the Company, instrument of assignment or
transfer, power of attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons.
(c) Notwithstanding anything in this Agreement to the contrary, in no
event shall the Rights Agent be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits), even if the Rights Agent has been advised of the likelihood of such
loss or damage and regardless of the form of the action.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Successor. Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust, stock transfer or other shareholder services
business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto;
provided, however, that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 (Change of Rights
Agent). In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Rights Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor or in
the name of the successor Rights Agent; and in all such cases such Rights
Certificates shall have the full force provided in the Rights Certificates and
in this Agreement.
(b) Prior Countersignatures. In case at any time the name of the
Rights Agent shall be changed and at such time any of the Rights Certificates
shall have been countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates shall not
have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all such
cases such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions, and no implied duties or obligations shall be read into this
Agreement against the Rights Agent, by all of which the Company and the holders
of Rights Certificates, by their acceptance thereof, shall be bound:
(a) Legal Counsel. Before the Rights Agent acts or refrains from
acting, the Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the
28
opinion of such counsel shall be full and complete authorization and protection
to the Rights Agent as to any action taken or omitted to be taken by it in good
faith and in accordance with such opinion.
(b) Certification by the Company. Whenever in the performance of its
duties under this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without limitation, the identity
of any Acquiring Person and the determination of Current Market Price) be proved
or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and established
by a certificate signed by the Chairman of the Board, the President, any Vice
President, the Secretary, any Assistant Secretary, the Treasurer or any
Assistant Treasurer of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) Liability for Negligence, etc. The Rights Agent shall be liable
hereunder only for its own negligence, bad faith or willful misconduct.
(d) Statements of Fact or Recitals. The Rights Agent shall not be
liable for or by reason of any of the statements of fact or recitals contained
in this Agreement or in the Rights Certificates or be required to verify the
same (except as to its countersignature on such Rights Certificates), but all
such statements and recitals are and shall be deemed to have been made by the
Company only.
(e) Agreement; Adjustments. The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Rights Certificate (except its
countersignature); nor shall it be responsible for any breach by the Company of
any covenant or condition contained in this Agreement or in any Rights
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights) or Section 13 (Consolidation, Merger or Sale or
Transfer of Assets or Earning Power) or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the existence of facts that
would require any such adjustment (except with respect to the exercise of Rights
evidenced by Rights Certificates after actual notice of any such adjustment);
nor shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any shares of Common Stock to
be issued pursuant to this Agreement or any Rights Certificate or as to whether
any shares of Common Stock will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) Further Assurances. The Company will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Agreement.
(g) Instructions. The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its duties hereunder
from the Chairman of the Board, the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer or any Assistant Treasurer of
the Company and to apply to such persons for advice or instructions in
29
connection with its duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with the instructions of
any such officer.
Any application by the Rights Agent for written instructions from the
Company may, at the option of the Rights Agent, set forth in writing any action
proposed to be taken or omitted by the Rights Agent under this Agreement and the
date on or after which such action shall be taken or such omission shall be
effective. The Rights Agent shall not be liable for any action taken by, or
omission of, the Rights Agent in accordance with a proposal included in any such
application on or after the date specified in such application (which date shall
not be less than ten Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall have consented
in writing to an earlier date) unless, prior to taking any such action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
(h) Dealing in Rights. The Rights Agent and any shareholder,
director, officer or employee of the Rights Agent may buy, sell or deal in any
of the Rights or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested, or
contract with or lend money to the Company or otherwise act as fully and freely
as though it were not Rights Agent under this Agreement. Nothing herein shall
preclude the Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) Agents; Reasonable Care. The Rights Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct; provided, however,
reasonable care was exercised in the selection and continued employment thereof.
(j) Expenses; Repayment Assurances. No provision of this Agreement
shall require the Rights Agent to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder
or in the exercise of its rights if there shall be reasonable grounds for
believing that repayment of such funds or adequate indemnification against such
risk or liability is not reasonably assured to it.
(k) Exercise of Rights; Consultation with Company. If, with respect
to any Rights Certificate surrendered to the Rights Agent for exercise or
transfer, the certificate attached to the form of assignment or form of election
to purchase, as the case may be, has either not been completed or indicates an
affirmative response to clause 1 and/or 2 thereof, the Rights Agent shall not
take any further action with respect to such requested exercise of transfer
without first consulting with the Company.
(l) No Constructive Notice. The Rights Agent shall not be required
to take notice or be deemed to have notice of any fact, event or determination
(including, without limitation, any dates or events defined in this Agreement or
the designation of any Person as an Acquiring Person, Affiliate or Associate)
under this Agreement unless and until the Rights Agent shall be specifically
notified in writing by the Company of such fact, event or determination.
30
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon thirty (30) calendar days' notice in writing mailed to the Company, and to
the transfer agent of the Common Stock, by registered or certified mail, and, at
the expense of the Company, to the holders of the Rights Certificates by first-
class mail. The Company may remove the Rights Agent or any successor Rights
Agent upon thirty (30) calendar days' notice in writing, mailed to the Rights
Agent or successor Rights Agent, as the case may be, and to the transfer agent
of the Common Stock, by registered or certified mail, and to the holders of the
Rights Certificates by first-class mail. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of thirty (30) calendar days after giving notice of
such removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder of a
Rights Certificate (who shall, with such notice, submit his Rights Certificate
for inspection by the Company), then the registered holder of any Rights
Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be (a) a corporation organized and doing
business under the laws of the United States or of any State of the United
States, in good standing, which is authorized under such laws to exercise stock
transfer or corporate trust powers, is subject to supervision or examination by
federal or state authority and either has or is an Affiliate of an entity that
has at the time of its appointment as Rights Agent a combined capital and
surplus of at least $50,000,000 or (b) an Affiliate of a corporation described
in clause (a) of this sentence. After appointment, the successor Rights Agent
shall be vested with the same powers, rights, duties and responsibilities as if
it had been originally named as Rights Agent without further act or deed; but
the predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Stock, and mail a notice thereof in writing to the registered holders
of the Rights Certificates. Failure to give any notice provided for in this
Section 21 (Change of Rights Agent), or any defect therein, shall not affect the
legality or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Rights Certificates. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Rights Certificates evidencing Rights in such form
as may be approved by the Board to reflect any adjustment or change in the
Purchase Price and the number or kind or class of shares or other securities or
property purchasable under the Rights Certificates made in accordance with the
provisions of this Agreement. In addition, in connection with the issuance or
sale of shares of Common Stock following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall, with respect to
shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereafter issued by the Company, in either
case outstanding as of the Distribution Date, and (b) may, in any other case, if
deemed necessary or appropriate by the Board, issue Rights Certificates
representing the appropriate number of Rights in connection with such issuance
or sale; provided, however, that (i) no such Rights Certificate shall be issued
if, and to the extent that, the Company shall be advised by counsel that such
issuance would create a significant risk of material, adverse tax consequences
to the Company or the Person to whom
31
such Rights Certificate would be issued, and (ii) no such Rights Certificate
shall be issued if, and to the extent that, appropriate adjustment shall
otherwise have been made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
(a) Redemption. The Company may, at its option, at any time prior to
the earlier of (i) the Close of Business on the tenth Business Day following the
Stock Acquisition Date (or, if the Stock Acquisition Date shall have occurred
prior to the Record Date, the Close of Business on the tenth Business Day
following the Record Date), or (ii) the Final Expiration Date, redeem (the date
of such redemption being referred to herein as the "Redemption Date") all but
not less than all of the then outstanding Rights at a redemption price of $0.01
per Right, as such amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the "Redemption Price");
provided, however, that if, following the occurrence of a Stock Acquisition Date
and following the expiration of the right of redemption hereunder but prior to
any Triggering Event, (i) a Person who is an Acquiring Person shall have
transferred or otherwise disposed of a number of shares of Common Stock in one
transaction or series of transactions, not directly or indirectly involving the
Company or any of its Subsidiaries, which did not result in the occurrence of a
Triggering Event such that such Person is thereafter a Beneficial Owner of 15%
or less of the outstanding shares of Common Stock, and (ii) there are not other
Persons, immediately following the occurrence of the event described in clause
(i), who are Acquiring Persons, then the right of redemption shall be reinstated
and thereafter be subject to the provisions of this Section 23. Notwithstanding
anything contained in this Agreement to the contrary, the Rights shall not be
exercisable after the first occurrence of a Flip-in Event until such time as the
Company's right of redemption hereunder has expired. The redemption of the
Rights by the Company may be made effective at such time, on such basis and with
such conditions as the Board in its sole discretion may establish. The Company
may, at its option, pay the Redemption Price in cash, shares of Common Stock
(based on the Current Market Price of the Common Stock at the time of
redemption) or any other form of consideration deemed appropriate by the Board.
(b) Effect of Redemption; Procedure. Immediately upon the action of
the Company ordering the redemption of the Rights, evidence of which shall have
been filed with the Rights Agent, and without any further action and without any
notice, the right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price for
each Right so held. Promptly after the action of the Board ordering the
redemption of the Rights, the Company shall give notice of such redemption to
the Rights Agent and the holders of the then outstanding Rights by mailing
notice to all such holders at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Distribution Date, on the
registry books of the transfer agent for the Common Stock. Any notice that is
mailed in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state the method
by which the payment of the Redemption Price will be made.
Amounts payable shall be rounded down to the nearest $0.01. Any notice
that is mailed in the manner provided in this Agreement will be deemed to be
given whether or not the holder receives the notice. In any case, the failure
to give such notice by mail, or any defect in the notice,
32
to any particular holder shall not affect the sufficiency of the notice to the
other holders of the Rights and the validity of the proceedings.
Section 24. Exchange.
(a) Right to Exchange. The Company may, at its option, at any time
and from time to time after the first occurrence of a Flip-in Event, exchange
all or part of the then outstanding and exercisable Rights (other than Rights
which have become void as provided in Section 7(e) (Exercise of Rights; Purchase
Price; Expiration Date of Rights -- Termination of Acquiring Person's Rights))
for the Exchange Number of shares of Common Stock or shares or units of other
equity securities (if authorized to be issued by the Articles of Incorporation)
which the Board has determined to be a Common Stock Equivalent, units of other
property or any combination thereof as determined by the Board. Notwithstanding
the foregoing, the Company shall not be empowered to effect such exchange at any
time after any Person (other than the Company, any Subsidiary of the Company,
any employee benefit plan of the Company or any such Subsidiary or any entity
holding shares of Common Stock for or pursuant to any such plan), together with
all Affiliates and Associates of such Person, becomes the Beneficial Owner of
50% or more of the shares of Common Stock then outstanding. The exchange of the
Rights by the Company may be made effective at such time, on such basis and with
such conditions as the Board in its sole discretion may establish.
(b) Effect of Exchange; Procedure. Immediately upon the action of
the Company ordering the exchange of any Rights pursuant to paragraph (a) of
this Section 24, evidence of which shall have been filed with the Rights Agent
and without any further action and without any notice, the right to exercise
such Rights will terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of shares of Common Stock, Common Stock
Equivalents or units of other property equal to the number of such Rights held
by such holder multiplied by the Exchange Number. Promptly after the action of
the Company ordering the exchange of the Rights, the Company shall (i) file
evidence of such action with the Rights Agent, (ii) give public notice of such
exchange; provided, however, that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange, and (iii) mail notice of
such exchange to the holders of such Rights at their last addresses as they
appear upon the registry books of the Rights Agent. Any notice that is mailed in
the manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the method by which
the exchange will be effected and, in the event of any partial exchange, the
number of Rights which will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights which have become void
as provided in Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date
of Rights -- Termination of Acquiring Person's Rights)) held by each holder of
Rights.
(c) Common Stock Equivalents. In any exchange pursuant to this
Section 24, the Company, at its option, may substitute Common Stock Equivalents
for Common Stock exchangeable for Rights, at the initial rate of one share of
Common Stock Equivalent for each share of Common Stock, as appropriately
adjusted to reflect adjustments in the voting rights of the Common Stock
pursuant to the Company's Articles of Incorporation, so that the share of Common
Stock Equivalent delivered in lieu of each share of Common Stock shall have the
same voting rights as one share of Common Stock.
33
(d) Insufficient Common Stock. In the event that the number of
shares of Common Stock which are authorized by the Company's Articles of
Incorporation but not outstanding or reserved for issuance for purposes other
than upon exercise of the Rights is not sufficient to permit any exchange of
Rights in accordance with this Section 24, or other equity securities are not
authorized by the Articles of Incorporation the Company may, at its option, take
all such action as may be necessary to authorize additional shares of Common
Stock or other equity securities for issuance upon such exchange.
(e) Fractional Shares. Upon the action of the Company ordering the
exchange of any Rights pursuant to paragraph (a) of this Section 24, the Company
shall not be required to issue fractions of shares or to distribute certificates
which evidence fractional shares. In lieu of such fractional shares, the Company
may pay to the registered holders of the Rights Certificates with regard to
which such fractional shares would otherwise be issuable an amount in cash equal
to the same fraction of the current market value of one share of Common Stock.
For purposes of this Section 24, the current market value of one share of Common
Stock shall be the closing price of one share of Common Stock (as determined
pursuant to Section 11(d)(i) (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights -- Current Market Price)) for the Trading Day
immediately prior to the date of exchange pursuant to this Section 24, and the
value of any Common Stock Equivalent shall be deemed to have the same current
market value as the Common Stock on such date.
Section 25. Notice of Certain Events.
(a) Common Stock Transactions, etc. In case the Company shall
propose, at any time after the Distribution Date, (i) to declare or pay any
dividend payable in stock of any class to the holders of Common Stock or to make
any other distribution to the holders of Common Stock (other than a regular
quarterly cash dividend out of earnings or retained earnings of the Company);
(ii) to offer to the holders of Common Stock rights or warrants to subscribe for
or to purchase any additional shares of Common Stock or shares of stock of any
class or any other securities, rights or options; (iii) to effect any
reclassification of its Common Stock (other than a reclassification involving
only the subdivision of outstanding shares of Common Stock); (iv) to effect any
consolidation with, merger into or with, or statutory share exchange or similar
transaction with, any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Restriction against Diminishing
Benefits of the Rights)), or to effect any sale or other transfer (or to permit
one or more of its Subsidiaries to effect any sale or other transfer), in one
transaction or a series of related transactions, of more than 50% of the assets,
cash flow or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section
11(o)); (v) to effect the liquidation, dissolution or winding up of the Company,
or (vi) to effect a subdivision, combination or consolidation of the shares of
Common Stock (by reclassification or otherwise than by payment of dividends in
Common Stock), then, in each such case, the Company shall give to each holder of
a Rights Certificate, to the extent feasible and in accordance with Section 26
(Notices), a notice of such proposed action, which shall specify the record date
for the purposes of such stock dividend, distribution of rights or warrants, or
the date on which such reclassification, consolidation, merger, statutory share
exchange or similar transaction, sale, transfer, liquidation, dissolution, or
winding up is to take place and the date of participation therein by the holders
of the shares of Common Stock, if any such date is to be fixed, and such notice
shall
34
be so given in the case of any action covered by clause (i) or (ii) above at
least twenty (20) calendar days prior to the record date for determining holders
of the shares of Common Stock for purposes of such action, and in the case of
any such other action, at least twenty (20) calendar days prior to the date of
the taking of such proposed action or the date of participation therein by the
holders of the shares of Common Stock, whichever shall be the earlier.
(b) Other Transactions. In case any of the events set forth in
Section 11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments) shall occur, then, in any such case,
(i) the Company shall as soon as practicable thereafter give to each holder of a
Rights Certificate, to the extent feasible and in accordance with Section 26
(Notices), a notice of the occurrence of such event, which shall specify the
event and the consequences of the event to holders of Rights under Section
11(a)(ii), and (ii) all references in the preceding paragraph to Common Stock
shall be deemed thereafter to refer to, if appropriate, other securities.
Section 26. Notices. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be sufficiently given or made if sent by telecopier
(with receipt confirmed) or by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Rights Agent) as follows:
Aztec Manufacturing Co.
000 X. Xxxxxxx Xx.
Xxxxxxx, Xxxxx 00000
Attention: Chairman of the Board
Subject to the provisions of Section 21 (Change of Rights Agent), any notice or
demand authorized by this Agreement to be given or made by the Company or by the
holder of any Rights Certificate to or on the Rights Agent shall be sent by
registered or certified mail and shall be deemed given upon receipt, addressed
(until another address is filed in writing with the Company) as follows:
Xxxxxx Trust and Savings Bank
0000 Xxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate (or, if
prior to the Distribution Date, to the holder of certificates representing
shares of Common Stock) shall be sufficiently given or made if sent by first-
class mail, postage prepaid, addressed to such holder at the address of such
holder as shown on the registry books of the Company.
Section 27. Supplements and Amendments. Prior to the Distribution Date
and subject to the penultimate sentence of this Section 27, the Company and the
Rights Agent shall, if the Company so directs, supplement or amend any provision
of this Agreement without the approval of any holders of certificates
representing shares of Common Stock. From and after the Distribution Date and
subject to the penultimate sentence of this Section 27, the Company and the
Rights Agent shall, if the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights Certificates in order
(i) to cure any ambiguity, (ii) to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provisions herein,
35
(iii) to shorten or lengthen any time period hereunder or (iv) to change or
supplement the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of Rights Certificates (other than an Acquiring Person or an Affiliate
or Associate of an Acquiring Person); provided, however, this Agreement may not
be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed at such
time as the Rights are not then redeemable, or (B) any other time period unless
such lengthening is for the purpose of protecting, enhancing or clarifying the
rights of, and/or the benefits to, the holders of Rights. Upon the delivery of
a certificate from an appropriate officer of the Company which states that the
proposed supplement or amendment is in compliance with the terms of this Section
27, the Rights Agent shall execute such supplement or amendment. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock. Notwithstanding
anything contained in this Agreement to the contrary, no supplement or amendment
shall be made which changes the Redemption Price, the Final Expiration Date, the
Purchase Price, or the number of shares of Common Stock for which a right is
exercisable; provided, however, that at any time prior to (i) a Stock
Acquisition Date or (ii) the date that a tender or exchange offer by any Person
(other than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan) is first published or sent or given within the meaning of Rule
14d-2(a) of the General Rules and Regulations under the Exchange Act, if upon
consummation thereof, such Person would be the Beneficial Owner of 15% or more
of the shares of Common Stock then outstanding, the Board may amend this
Agreement to increase the Purchase Price or extend the Final Expiration Date.
Notwithstanding anything in this Agreement to the contrary, no supplement or
amendment that changes the rights and duties of the Rights Agent under this
Agreement will be effective against the Rights Agent without the execution of
such supplement or amendment by the Rights Agent.
Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Determinations and Actions by the Board of Directors, etc.
For all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act. The Board (with, where specifically provided for herein,
the concurrence or approval of the Disinterested Directors) shall have the
exclusive power and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Board (with, where specifically
provided for herein, the concurrence or approval of the Disinterested Directors)
or to the Company, or as may be necessary or advisable in the administration of
this Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Agreement, and (ii) make all determinations
deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or not redeem the Rights or to amend the
Agreement). All such actions, calculations, interpretations and determinations
(including, for purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board (with, where specifically
provided for herein, the concurrence or approval of the Disinterested Directors)
in good faith, shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the
36
holders of the Rights and all other parties, and (y) not subject the Board or
the Disinterested Directors to any liability to the holders of the Rights.
Section 30. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any Person other than the Company, the Rights Agent and
the registered holders of the Rights Certificates (and, prior to the
Distribution Date, registered holders of the Common Stock) any legal or
equitable right, remedy or claim under this Agreement; but this Agreement shall
be for the sole and exclusive benefit of the Company, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, registered holders of the Common Stock).
Section 31. Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board determines
in its good faith judgment that severing the invalid language from this
Agreement would adversely affect the purpose or effect of this Agreement, the
right of redemption set forth in Section 23 (Redemption and Termination) shall,
if it has terminated, expired or otherwise become inoperative, be reinstated and
shall not expire until the Close of Business on the tenth Business Day following
the date of such determination by the Board. Without limiting the foregoing, if
any provision requiring a majority of the Board to be Disinterested Directors to
act is held by any court of competent jurisdiction or other authority to be
invalid, void or unenforceable, such determination shall then be made by the
Board in accordance with applicable law and the Company's Articles of
Incorporation and By-Laws.
Section 32. Governing Law Section. This Agreement, each Right and each
Rights Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Texas and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and to be performed entirely within such State; provided, however, that all
other duties, obligations and responsibilities of the Rights Agent shall be
construed in accordance with the laws of the State of Illinois.
Section 33. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
* * * * *
37
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
Attest: AZTEC MANUFACTURING CO.
By: By:
------------------------------ ------------------------------
Xxx Xxxxx X.X. Xxxxxx
Secretary Chairman of the Board and Chief
Executive Officer
XXXXXX TRUST AND SAVINGS BANK,
as Rights Agent
By:
------------------------------
38
Exhibit 1
---------
[FORM OF RIGHTS CERTIFICATE]
Certificate No. R____ ______ Rights
NOT EXERCISABLE AFTER JANUARY 7, 2009 OR EARLIER IF REDEEMED BY AZTEC
MANUFACTURING CO. ("THE CORPORATION"). THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE CORPORATION, AT
$0.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT DATED AS OF
JANUARY 7, 1999, BY AND BETWEEN THE CORPORATION AND XXXXXX TRUST AND SAVINGS
BANK, AS RIGHTS AGENT (THE "RIGHTS AGREEMENT"). UNDER CERTAIN CIRCUMSTANCES,
RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM IS DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND
VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS
REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN
SECTION 7(e) (EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS --
TERMINATION OF ACQUIRING PERSON'S RIGHTS) OF SUCH AGREEMENT.]/1/
RIGHTS CERTIFICATE
AZTEC MANUFACTURING CO.
This certifies that ______________________________________________________,
or its, his or her registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner thereof, subject to the
terms, provisions and conditions of the Rights Agreement, dated as of January 7,
1999 (the "Rights Agreement"), between Aztec Manufacturing Co., a Texas
corporation (the "Corporation"), and Xxxxxx Trust and Savings Bank (the "Rights
Agent"), to purchase from the Corporation at any time prior to 5:00 P.M. (Fort
Worth, Texas time) on January 7, 2009 at the office or offices of the Rights
Agent designated for such purpose, or its successors as Rights Agent, one fully
paid, nonassessable share of Common Stock (the "Common Stock") of the
Corporation, at a purchase price of $60.00 per share (the "Purchase Price"),
upon presentation and surrender of this Rights Certificate with the Form of
Election to Purchase and related Certificate duly executed. The Purchase Price
shall be paid, at the election of the holder, in cash or shares of Common Stock
of the Company having an equivalent value. The number of Rights evidenced by
this Rights Certificate (and the number of shares which may be purchased upon
exercise thereof) set forth above, and the Purchase Price per share set forth
--------------------
/1/ The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
39
above, are the number and Purchase Price as of _______________, _____, based on
the Common Stock as constituted at such date. The Corporation reserves the right
to require prior to the occurrence of a Triggering Event (as such term is
defined in the Rights Agreement) that upon any exercise of Rights, a number of
Rights be exercised so that only whole shares of Common Stock would be issued.
Upon the occurrence of a Flip-in Event (as such term is defined in the
Rights Agreement), if the Rights evidenced by this Rights Certificate are
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate or
any such Person (as such terms are defined in the Rights Agreement), (ii) a
transferee of an Acquiring Person or its Associate or Affiliate who becomes a
transferee after such Acquiring Person or its Associate or Affiliate becomes
such, or (iii) under certain circumstances specified in the Rights Agreement, a
transferee of an Acquiring Person or its Associate or Affiliate who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such,
such Rights shall become null and void and no holder hereof shall have any right
with respect to such Rights from and after the occurrence of such Flip-in Event.
As provided in the Rights Agreement, the Purchase Price and the number and
kind of shares of Common Stock or other securities, which may be purchased upon
the exercise of the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events, including
Triggering Events (as such term is defined in the Rights Agreement).
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Corporation and the holders of the Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-mentioned office of the
Rights Agent and are also available upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at the principal office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of shares of Common Stock as the Rights
evidenced by the Rights Certificate or Rights Certificates surrendered shall
have entitled such holder to purchase. If this Rights Certificate shall be
exercised in part, the holder shall be entitled to receive upon surrender hereof
another Rights Certificate or Rights Certificates for the number of whole Rights
for which this Rights Certificate is not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Corporation at its option at a
redemption price of $0.01 per Right at any time prior to the earlier of (a) the
Close of Business (as such term is defined in the Rights Agreement) on the tenth
(10th) Business Day (as such term is defined in the Rights Agreement) following
the Stock Acquisition Date (as such term is defined in the Rights Agreement) (as
such time period may be extended pursuant to the Rights Agreement) or (b) the
Final Expiration Date (as such term is defined in the Rights Agreement) and (ii)
may be exchanged in whole or in part for shares of Common Stock, other property
or any combination thereof.
40
In addition, the Rights may be exchanged, in whole or in part, for shares
of the Common Stock, or shares of common stock equivalents of the Corporation
having essentially the same value or economic rights as such shares.
Immediately upon the action of the Board of Directors of the Corporation
authorizing any such exchange, and without any further action or any notice, the
Rights (other than Rights which are not subject to such exchange) will terminate
and the Rights will only enable holders to receive the shares issuable upon such
exchange.
No fractional shares of Common Stock will be issued upon the exercise of
any Right or Rights evidenced hereby, but a cash payment may be made in lieu
thereof, as provided in the Rights Agreement.
No holder of this Rights Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of shares of Common Stock or
of any other securities of the Corporation which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a shareholder of the Corporation or any right to vote for the election of
directors or upon any matter submitted to shareholders of the Corporation at any
meeting thereof, or to give or withhold consent to any corporate action or to
receive notice of meetings or other actions affecting shareholders of the
Corporation (except as provided in the Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by this Rights Certificate shall have been exercised as provided in
the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Corporation
and its corporate seal.
Dated as of
--------------------
ATTEST: AZTEC MANUFACTURING CO.
-------------------------------
Secretary By:
------------------------------
Title:
------------------------------
Countersigned:
RIGHTS AGENT
By:
---------------------------
Authorized Signature
41
[FORM OF REVERSE SIDE OF RIGHTS CERTIFICATE]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED, _______________________________________________________
hereby sells, assigns and transfers unto _______________________________________
________________________________________________________________________________
(PLEASE PRINT NAME AND ADDRESS OF TRANSFEREE)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ____________________________
Attorney, to transfer the within Rights Certificate on the books of the within-
named Corporation, with full power of substitution.
Dated:
----------------------- ------------------------------
Signature
Signature Guaranteed:
-------------------------------------
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as such terms are defined
in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate
from any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated:
-------------------- ------------------------------
Signature
Signature Guaranteed:
------------------------------
42
NOTICE
The signature to the foregoing Assignment and Certificate must correspond
to the name as written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any change whatsoever.
43
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the
Rights Certificate.)
To: AZTEC MANUFACTURING CO.
The undersigned hereby irrevocably elects to exercise _______________
Rights represented by this Rights Certificate to purchase the shares of Common
Stock issuable upon the exercise of the Rights (or such other securities of the
Corporation or of any other person which may be issuable upon the exercise of
the Rights) and requests that certificates for such shares be issued in the name
of and delivered to:
Please insert social security or
other identifying number
--------------------------------------------------------------------------------
(PLEASE PRINT NAME AND ADDRESS)
--------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
Please insert social security or
other identifying number
--------------------------------------------------------------------------------
(PLEASE PRINT NAME AND ADDRESS)
--------------------------------------------------------------------------------
Dated:
-------------------- -------------------------------
Signature
Signature Guaranteed:
44
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate
from any Person who is, was or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated:
-------------------- ------------------------------
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to Purchase and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
45
